The inspiring success story of Bandhan

The inspiring success story of Bandhan

What sets Bandhan apart is the roots it has in the world of the rural poor, says Subir Roy.

Chandra Shekhar Ghosh has come a long way - from Tripura to Bangladesh to West Bengal to now the national scene.

The microfinance organisation Bandhan, which he founded in 2001 and helped grow, has won the right to become a full-fledged commercial bank that can and will have its branches from Srinagar to Thiruvananthapuram in the not too distant future.

The inspiring success story of Bandhan

A couple of years ago, when I first met him and asked why he was not tomtomming Bandhan's journey to the top of the microfinance league, he said he preferred to maintain a low profile and get on with the work.

When on my first visit to Bandhan's multi-storied head office in Kolkata's information technology hub in Salt Lake, I noted he had some of the best-known global names as neighbours, he readily admitted that the real estate was a bargain he was able to pick up when the property market plummeted after 2008.

The inspiring success story of Bandhan

As with all those who are able to turn great ideas into reality, Ghosh was hardly realistic when he started off in 2000 on his own by taking out Rs 2 lakh from the family business to partner a brace of NGOs.

Getting them to scale up was a problem and so next year he took a momentous step, set up his own NGO with loans from in-laws, sister and even a moneylender at 7.5 per cent monthly interest.

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Image: Ghosh was hardly realistic when he started off in 2000 on his own.Photographs: Courtesy, Bandhan

The inspiring success story of Bandhan

Ghosh and Bandhan have had three lucky breaks which speak of both the earthy soundness that he exudes and the ability of these organisations to spot and recognise it.

The first lucky break, which literally saved his capital from the moneylender, came from the Small Industries Development Bank of India (Sidbi), which, after countless visits by him, eventually delivered a Rs 25 lakh loan in 2002.

Bandhan's work then acquired minimum scale and viability and Sidbi is now a shareholder.

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Image: Ghosh and Bandhan have had three lucky breaks.Photographs: Courtesy, Bandhan

The inspiring success story of Bandhan

The third lucky break came in 2011 when the World Bank's affiliate International Finance Corporation stepped in with funding and eventually became a shareholder in Bandhan, now a non-banking financial company.

What sets Bandhan apart is the roots it has in the world of the rural poor.

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Image: Bandhan has roots in the world of the rural poor. Photographs: Courtesy, Bandhan

The inspiring success story of Bandhan

What is fascinating is that Bandhan, a sound financial operation with reserves exceeding Rs 1,000 crore, began and grew out of West Bengal, which has not only been struck by long-term industrial blight but where the hazards of commercial lending are highlighted by the current plight of United Bank of India.

Keeping costs low in a viable business that has been growing at 20 per cent plus owes much to the earthy business sense of Ghosh.